| Show Dual Spending i Of City's Cash Hit in Report Auditors Find D Deficit Cut in Year I J. J Although Total Remains at p Accounting Practices Changed By AL FERGUSON Asserted double spending of of tax revenues by Salt Lake City's government a practice in vogue for many years but which is now on the way toward elimination was criticised criticised criticised Wednesday by J. J Percy Goddard and Roy G G. Abbey public accountants when they submitted to city commissioners commissioners commis commis- f. f the special audit report for 1935 J The report covers the month 12 J period ending December 31 1935 1 and shows the city ended the year f with a cash deficit of after aCter reducing the deficit by i in the period The cash deficit results from the j fact that after the current years year's general tax collections and other revenue collections have been re received received received re- re the available a funds have been insufficient to redeem tax anticipation anticipation an an- notes issued to finance i the years year's operations Regular 1 monthly statements of ot the city audit have bave shown surpluses surpluses sur sur- pluses because it has been cust customary customary cus cus- t tomary for many years to include as u an an available asset the accumulated accumulated uncollected taxes of prior years How Deficit Comes The carrying of uncollected taxes as an asset assel provides the surplus balances in place of ot cash deficits states the audit f J report When Whorl taxes receivable not 7 r collected in the year ear assessed arc are ji taken into a years year's revenue sel setup p 4 v the tendency is to spend the entire revenue as set up Then when the 7 i deferred c collections ar are received the 1 j temptation is great to spend the same Bame revenue a second time and thus create an actual deficit v An illustration is made of 1935 f operations when extraordinary collections col- col k of back taxes were made 1 The amount was more than thant 5 t the estimated tax sety set- set c 1 y up for the year f r Logically the cash deficit should have been reduced by that amount states the audit report But the 1935 disbursements exceeded exceed exceed- ed the revenue setup to the extent that all except of the extraordinary tax revenue collections was needed to meet current operating i i expenses The plus in tax anticipation notes which were re refunded refunded refunded re- re funded as general obligation bonds after being first set up as a current current current cur cur- rent expense accounts for the which the cash deficit was re reduced reduced reduced re- re in 1935 Remove False Asset Cash deficits thus created have been carried as deficits since January January Jan Jan- uary 1 to eliminate this asserted I false asset explained City Auditor Samuel F. F Nichols Special auditors report all aU Recounts accounts ac Re- ac- ac p counts in balance and commend accounting accounting act ac- ac c counting and finance divisions of ot the city gov government on several t tc points The report also shows a total of ot i in accounts receivable The t figure includes in the Wak wa- wa k f consumers' consumers meter account on the engineering department depart- depart ment books hooks and on the City i cemetery books i Referring to the latter figure the report states f On the whole these accounts appear appear appear ap- ap pear to have been well vell kept except t for the City cemetery which accounts aci ac- ac 1 i counts were criticised by your sp special ape ape- cial auditors for 1934 From FromI I l an investigation started in 1935 it appears that due to inadequate reci records rec- rec lords i and failure to follow up collection collections collections col- col lection thousands of ot dollars have 1 been lost to the city on ordinary I care and perpetual care accounts A j compilation has been made of these 1 accounts of ot past years and an effort effort ef- ef s fort is being made to collect them 3 Also a new system of ot records is J being installed 2 Bonds Redeemed 5 Referring to action of ot the tha city commission several months ago in int 1 t the investment of from the sinking fund in general obligation city bonds duo due in 1954 the report continues r These bonds entered as an in inVestment investment investment in- in vestment are arc being held by the First Security Ity Trust company but t we see no good reason why they should not be treated as redeemed Continued on P Pa Pare K Two Column One I CITY'S i s 's DOUBLE SPENDING HIT HITS S Continued from Pa Pr Pare One ODe bonds and canceled especially since the they the are part of the issue for tor which the tho sinking fund Is created Tho bonds referred to are arc the first to be taken up by th the city of An Issue izue made mode in 1894 to finance construction of at the city and county build building i The original Issue twice has been refunded Renewed recommendation that the city maintain a In Inventory Inventory Inventory In- In of all aU movable movables and salable properties in various arlou offices and departments de de- de- de is contained in tho the report re rc- re- re port portA ort A balance sheet of the special 1 Improvement fund is s contained in Inthe inthe the report the first to be shown According to veteran attaches of or the accounting department for many years It discloses the tho fund is solvent and liquid despite more than 7 due dUll in tax assessments made for sidewalks curb gutter street pavements and sewers The fund has lIas a 1 surplus of at when all sit liabilities are considered against all alt assets according t to t the e report County Collects Another compilation shows that on n De ember 31 1935 the county treasurer owed Salt Lake City only on tax collections for 1935 and prior years year The Tho county treasurer treasurer trea trea- surer aurer by law is made the thc collection Agency f for far r all aU g general taxes paid in Salt Lake county and he apportions apportions apportions these revenues revenues to fo various taxIng taxing tax tax- ing units of at the county including Salt Lake City During 1935 the city r received 1 si- si in 19 1935 taxes from the county treasurer It also received in taxes that became delinquent delinquent delin delia quent In prior r years and were paid the county treasurer in 1935 the auditors reported Total tax credits made to Salt Lake City in 1935 by the county treasurer were All of that amount had been received by byth bythe th the city by December 31 1935 except except except ex ex- ex- ex the a belated apportionment apportionment apportionment which has since been paid and charged against the city as interest on tax redemptions City commissioners ordered the report filed |
